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♪it's so important to make someone happy.♪ ♪make just one someone happy ♪and you will be happy too. [ticking] >> dr. ecklund, i'm scott pelley with 60 minutes. >> oh, great. >> dr. ecklund was surprised to see us. we had hidden our cameras, something we rarely do at 60 minutes, so we could uncover his plan to inject stem cells from a questionable source into this 11-year-old boy with cerebral palsy. how does it work exactly? >> well, stem cells contain... uh... excuse me, here. [ticking] >> in 2009, chrysler was headed

towards the junkyard. but in 2011, the company made $183 million and paid back its $6-billion federal bailout, 6 years ahead of schedule. and none of it would have happened without its italian-born, canadian-raised boss, sergio marchionne. >> from 60 minutes. >> oh, yeah. sorry to barge in on you like this. does he walk in all the time? >> occasionally, yeah. [ticking] >> in the beautiful italian province of perugia, men roam the frosty hills with their trained dogs, hunting for the most expensive food in the world. so this is $1,000? just right there is $1,000. but as we found out, anything this rare and expensive can attract a dangerous clientele. >> [speaking french] >> everybody's in danger in this business. >> krrrk. >> welcome to 60 minutes on cnbc. i'm bob simon. in this edition, we're going to visit with a driving force

behind the resurrection of chrysler. and later, hunt for the most expensive food in the world. but first, we begin with a story about the rapidly growing trade in fake stem cell cures. many people with incurable illness look forward to the promise of stem cells. stem cells have the potential to turn into any kind of cell, and in theory, they could repair damaged cells. scientists tell us that we are years away from realizing that dream. but conmen have moved in to offer the hope that science cannot. just look online and you'll find hundreds of credible-looking websites offering stem cell cures in overseas clinics. as scott pelley reported in january 2012, the 60 minutes investigation found something even more alarming: illegal stem cell transplants that are dangerous and delivered to your doorstep. >> i know you're tired. >> adam and brandon susser

are 11-year-old twins. adam has cerebral palsy, his brain was damaged by a lack of oxygen before he and his brother were born. >> he's confined to a wheelchair. he needs assistance with all his daily living activities from cleanliness to feeding to clothing. >> gary and judy susser have searched for anything that might improve on the judgment handed down by adam's doctors. >> the sentence of being a quadriplegic, the sentence of being totally blind, the pronouncement by physicians that we should put him away. >> so back in 2003, the sussers took a chance on the theory of stem cells. adam was three. >> they brought him to a doctor in mexico who injected stem cells with no idea whether they would work. >> the progress that he made after that was minimal at best, and, therefore, we didn't see any good coming out of it. >> today people like

the sussers can find hundreds of sophisticated websites offering stem cell treatments for every hopeless disease. >> i see how people are preyed upon by hucksters and charlatans. and people who have a special child don't need any more expense, don't need any more heartache, and don't need any more false promises. they need the truth, and they need hope. that a boy. >> to help us learn the truth about the illicit stem cell industry, the sussers agreed to work with us in an investigation of one stem cell laboratory. we focused on stem tech labs of ecuador, because it offers cures for cerebral palsy and a long list of 70 incurable diseases. the website claims a "modern day medical miracle" and says, "we are f.d.a. registered," apparent approval from the food and drug administration. the founder and director of stem tech labs is an alabama doctor

named dan ecklund. we've been tracking dr. ecklund for months. >> hello, is dan ecklund there, please? >> we asked the sussers to contact dr. ecklund. ecklund sent them a letter which offered the blind and paralyzed adam the possibility of an improved level of consciousness, improved ability to see, to speak, to stand, and walk. what can stem cells really do today? we asked a scientist who's doing some of the world's most advanced studies in stem cells, dr. joanne kurtzberg. >> i personally think we're 10 years away from seeing real cell therapies that are working and are safe, but i do believe it will come. >> dr. kurtzberg is a physician and the chief scientific officer of a stem cell research program at duke university. she advises the federal government and is the codirector of this multimillion dollar laboratory which works with stem cells harvested

from umbilical cord blood. dr. kurtzberg told us there's no evidence yet that stem cells can treat cerebral palsy. >> some of the diseases that we see stem cell cures offered for on the internet include multiple sclerosis. >> there are no stem cell cures yet for multiple sclerosis. >> lou gehrig's disease? >> i wish there were, but there are not. >> you know, i wonder how often it happens that you have to tell a patient, "i'm sorry. there's nothing we can do." and then they come back to you two days later and say, "well, i see all these cures on the internet." >> mm-hmm, i get many of those calls and emails and see many of those patients. but it's very dishonest to mislead people when there's nothing you can do. [ticking] >> coming up, confronting dr. ecklund. >> frankly, dr. ecklund, you have nothing to base your results on. there's no clinical trial, there's no-- there's no blind study. there are no medical papers

published. >> that doesn't make any difference. >> our investigation of stem cell fraud continues when 60 minutes on cnbc returns. [ticking] hey! did you know that honey nut cheerios

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plus, free same-day delivery, set-up, and removal of your old set. don't wait, sleep train's year end clearance sale ends sunday. superior service, best selection, lowest price, guaranteed. ♪ sleep train ♪ your ticket to a better night's sleep ♪ >> in 2011, the parents of 11-year-old adam susser, who has cerebral palsy, agreed to work with a 60 minutes investigation

of an ecuador-based stem cell laboratory run by dr. dan ecklund. although current stem cell research offers no cure for cerebral palsy, ecklund told the sussers there's a lot that can be done for their son. >> say hello to dr. dan. adam. >> hello, adam. >> can you see him, doc? >> dr. ecklund's only examination of adam came by teleconference. ecklund didn't know we were watching. >> do you think it would help him, you know, make him improve? >> i think it's likely to help him, yes. i would say... 75% chance that it--that he would have a noticeable improvement. >> ecklund proposed four treatments costing a total of $20,000. the sussers asked ecklund to treat adam near their florida home. >> again, my concern would be the legalities of it. >> he's right to be concerned. it would be a felony to use stem cells

in an unapproved therapy or to sell them for export to the u.s. that's why we were surprised to see this on many websites: a shopping cart. we clicked on ecklund's stem tech labs cart, and, with no medical or scientific credentials, we bought 20 million umbilical cord stem cells for $5,000, shipped to america. we had the cells sent by the highest medical standard. duke university suggested we use something called a dry shipper, cooled with liquid nitrogen. we sent the dry shipper to stem tech. stem tech sent the frozen cells to us. and we forwarded them to joanne kurtzberg. a computer chip inside our package verified that the cells were properly frozen all the way. dr. kurtzberg analyzed the cells. for comparison, look under the microscope. healthy umbilical cord

stem cells look like this. the cells we got from stem tech had disintegrated. >> so these are the cells you purchased. and they are dying or dead. >> we see all of these dead and disintegrating cells and, essentially, cellular debris. >> mm-hmm. >> are there dangers of injecting that into someone? >> there are huge dangers if you injected that into someone's blood or spinal fluid, because all these little fragments and debris would get trapped somewhere in the bloodstream and could cause a stroke or, in the brain, could cause an inflammatory reaction. >> remember, the sussers asked dr. ecklund to treat adam in the u.s. and in december 2011, he got out of a van to meet gary susser at a florida hotel where ecklund planned to do the transplant. we dug into dr. ecklund's background, and we found things that he hadn't told the sussers. this is the document in which the state of alabama revoked

his medical license in 2005. the state medical commission said dr. ecklund admitted that he: "prescribed controlled substances to a patient with whom he was having sex," "prescribed controlled substances to a patient who he knew was a drug addict," and "had sexual experiences with young female children." we also tracked down his laboratory in ecuador, not exactly the state of the art facility claimed in his website. the hotel room gary susser and dan ecklund headed for was set up with a number of cameras that were tucked out of sight. susser excused himself. ecklund was expecting to meet judy and adam, the blind and paralyzed 11-year-old in whom he intended to transplant stem cells, cells from his lab that sold us the dangerous biomedical junk. instead, we came in. >> dr. ecklund, i'm scott pelley

with 60 minutes. >> oh, great. >> how are you today? >> i am, uh...surprised. >> we've been working with the sussers on a story, and i want you to know that we're being recorded. and i wanted to ask you about the treatment that you propose for adam. what would that be? >> the treatment that he asked about was for stem cells, human stem cells. >> and you think they're applicable for cerebral palsy? >> yes. i have seen them be effective in cases of cerebral palsy. >> how does that work exactly? >> well, stem cells contain... uh... excuse me, here. no one knows exactly, okay? but stem cells do contain and give off chemicals which cause other cells

to repair themselves. >> in the letter that you sent the sussers, you described possible effects for adam, which could include improved ability to see, improved ability to speak, improved ability to move arms and legs. you believe those things are possible? >> i do. >> what is your training in stem cells? >> my training in stem cells was, i studied for about six years going over the literature. and then i started producing stem--stem cells in my lab. >> you're self-educated, self-taught? >> mm-hmm. >> have you published any research? >> no. >> frankly, dr. ecklund, you have nothing to base your results on. there's no clinical trial, there's no-- there's no blind study. there are no medical papers published. >> that doesn't make any difference. >> ecklund told us breakthroughs with stem cells

aren't published in scientific journals because of a conspiracy of drug companies and governments that he had trouble defining. that's when we told him we bought cells from his lab. when your cells are delivered, they're functioning, living stem cells? >> yes. >> we purchased some stem cells from stem tech labs six months or so ago and had them delivered to duke university, which did tests on the stem cells. and they determined that the stem cells were dead. >> well, they must not have handled them appropriately, then. >> you're thinking that you handled them appropriately, but the stem cell laboratories at duke university did not? >> that would be my assumption, yeah. >> i don't think that there's any chance they were damaged in shipment. >> we asked dr. kurtzberg to listen to ecklund's theories >> yes. i have seen them be effective

in cases of cerebral palsy. >> this is pretty scary, actually, that he would be saying these things, that he would be leading them on this way, because what he's talking about is very dangerous. >> is this a con, dr. ecklund? >> no, it's not a con. i have taken the stem cells myself. would i take the stem cells if i thought that they were a con? no. >> putting them in an 11-year-old boy is entirely a different matter. >> that's why i took care to explain the remotest possible difficulties, which have never been reported. >> without any medical studies that have been published in major journals... >> [laughs] >> that have suggested that stem cells have any efficacy in cerebral palsy-- >> you keep going back to this point,

that they're not published in major ethic-- in major medical journals. i'm telling you-- >> it is the standard of the world. i do keep going to that point. >> i'm telling you that they are not going to be published in this country, because when someone does try to do it, then they have 60 minutes come and visit them. and i think that's enough for me, thank you. >> we don't know where dan ecklund went, but we do know that of late 2012, he could still be found listed online as a trustee of an organization called global genius trust. the g.g.t. website claims that it's "a holding company of innovative companies using cutting-edge technologies to make a difference in the world and for our investors." ecklund's biography on the g.g.t. website claims, among other things, that he's an m.d., has delivered over 200 babies, and speaks english, chinese,

and french. [ticking] coming up, the resurrection of chrysler. >> i remember when i came here in 2009. there's nothing worse for a leader than to see fear in people's faces. it's been a long rocky road, but the fear is gone. >> that's ahead when 60 minutes on cnbc returns. [ticking] ♪

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did you just turn your ringer off so no one would interrupt and.us?one. oh no, i... just used my geico app to get a tow truck. it's gonna be 30 minutes. oh, so that means that we won't be stuck up here, for hours, with nothing to do. oh i get it, you wanna pass the time, huh. (holds up phone) fruit ninja!!! emergency roadside assistance. just a click away with the geico mobile app. [ticking] >> in 2009, chrysler was headed for the junkyard crusher, leaking cash and about to be scrapped. it was unloved and unwanted. but in one of the most dramatic

turnarounds in the history of the american automobile industry, in 2011, chrysler turned a $180-million profit. much of the credit goes to u.s. taxpayers and to chrysler workers who accepted wage and benefit cuts. but as steve kroft reported in march 2012, none of it would have happened without the efforts of an italian-born and canadian-raised auto executive named sergio marchionne. >> with his gray stubble, longish hair, relaxed demeanor, and trademark black sweaters, sergio marchionne looks more like a film director than an auto executive, but he is now the industry's biggest star. >> sergio marchionne. >> the ceo of fiat had already rescued that company from financial ruin, and in chrysler, marchionne saw at least one similarity: both companies had been through hell. >> i remember when i came here in 2009. there's nothing worse

for a leader than to see fear in people's faces. it's been a long rocky road, but the fear is gone. >> what were they afraid of? >> of not being here. all right, it's that simple. this was really a question of existence. there's nothing worse in life than to sit there and be the victim of a process that's outside your control. >> and that was exactly the situation at chrysler in early 2009 when marchionne began negotiating with the federal government over a controlled bankruptcy of chrysler that would allow fiat to take over the failing auto company. it was the last hope for chrysler and its 54,000 employees. >> and there wasn't a ceo in the world from the car side that would have touched this with a 10-foot pole. >> it gave you a little leverage? >> it gave me some leverage and a whole pile of downside risk. you can't--you know, for you to be the only guy at the bar, there's got to be a reason,

right? >> if sergio had not appeared, i think it's very likely chrysler would have been allowed to liquidate. >> steve rattner, who was head of the presidential task force on the auto industry, sat across from marchionne at the bargaining table during the height of the economic crisis. rattner believes that chrysler's demise could have cost 300,000 american jobs up and down the industrial supply chain. >> was he a tough negotiator? >> brutally tough, yeah. he--but that's part of why he's successful. >> in the end, marchionne and fiat got a 20% stake in the brand-new, slimmed down, debt-free chrysler plus a $6-billion high interest loan from the u.s. treasury, just for taking the auto company off the government's hands and running it. he used the $6 billion to modernize chrysler plants with state-of-the-art equipment to improve quality, upgraded 16 existing models in just 18 months, and began integrating chrysler and fiat's operations.

obviously, you saw something in chrysler that you thought would fit well with fiat? >> yeah, from a product standpoint, they were the other half of the coin. when you put the two together, we were gonna come up with a product portfolio that was absolutely complete. >> chrysler's best assets were its jeeps, minivans, and light trucks. fiat's expertise was in small car technology and fuel-efficient engines, the very thing that chrysler lacked. and in april of 2012, the first product of that collaboration began rolling off the assembly line in belvidere, illinois. >> this car didn't even exist on paper in june of 2009. >> it's the dodge dart, the first new compact sedan that chrysler has produced in more than a decade. it's a slightly longer and wider version of the alfa romeo giulietta, reengineered and built in the usa. base price just under $16,000 with 40 miles to the gallon. how important is this car

to chrysler? >> if you are a serious carmaker and you can't make it into this segment, it--it--you're doomed. >> it's got a little italian flair? >> yeah. just enough to make it interesting, and it avoids all the pitfalls of being italian, yeah? >> [chuckles] mechanically, it's good? >> mechanically, it's outstanding. >> the darts produced at the belvidere plant are not just for u.s. consumption. marchionne plans to begin exporting them to more than 60 countries. when he took over chrysler in 2009, this plant had 200 workers. by the end of summer 2012, there would be 4,500. what do you think of american workers? >> i think the world of american workers. what happened here at chrysler would have been impossible without the commitment that they've shown, absolutely impossible. when i was looking at this deal back in 2009, i snuck into jefferson, our plant that now makes

the grand cherokee. and i'll tell you, if i had any reservations about doing this deal, it was after i saw the state of that plant. and the people that fixed that plant are the guys on the shop floor. >> like most of detroit's automakers, chrysler was saddled with a stifling bureaucracy, which marchionne quickly culled. to change the management structure, he combed through the company and found 26 young leaders who would report directly to him. were they on the management fast track? >> no, some of these people were buried inside an incredibly hierarchical organization that, you know, all pointed to the top. this place was run by a chairman's office. that's the tower, right? >> uh-huh. >> and the chairman's office is the top floor. it's empty now. we use it as a tourist trap. we bring people up there. >> why did you leave? >> because nothing happens there.

i'm on the floor here with all the engineers. >> with the engineers? >> yeah. i can build a car with all the guys on this floor. that's all i care about. >> how do they feel about you having-- >> they love it. >> on the floor? >> [laughs] the official view is that they love it. >> he looks familiar to me. >> from 60 minutes. doug betts. >> how are you doing? >> hey, doug, how are you? whether they like it or not, everyone on the floor seems to have gotten used to his presence. sorry to barge in on you like this. does he walk in all the time? >> occasionally, yeah. [ticking] >> coming up, chrysler's ceo answers his critics. >> just to rectify the record here. i paid back the loans and 19.7% interest. i don't think that i committed to do a commercial on top of that. >> that's ahead when 60 minutes on cnbc returns. [ticking] i've been coloring liz's hair for years.

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>> the 300 in many ways is, obviously, the flagship of the chrysler brand. >> ralph gilles is in charge of product design at chrysler and one of the rare holdovers from the old regime. the chrysler 300 and the dodge dart are his babies. he says the company has always had good talent, but a lack of resources and execution produced cheap interiors and poor fit and finish. >> everyone knew what was wrong with the cars. you could ask any employee in the company, they could list ten things that they would do better. and when you're given the chance to do those ten things better, you end up with a product that exceeds the sum of its parts. [hip-hop music] >> the company has also made strides in reshaping its image. chrysler's dramatic "imported from detroit" campaign with eminem was hugely successful.

>> it's half-time. >> and this two-minute, $8-million super bowl ad with clint eastwood, extolling the resiliency of america and its automobile industry, caused a major stir and briefly became part of the presidential campaign. republicans said that this was a campaign commercial for president obama, a payback. did you anticipate that criticism? >> just to rectify the record here. i paid back the loans and 19.7% interest. i don't think that i committed to do a commercial on top of that. i thought that the republicans' reactions to this was unnecessary and out of place. >> that's very restrained from you--for you. >> it is. i'm on camera. [laughs] you put me here. you turn these things off, i'll give you my own assessment. this is the old boardroom of fiat. >> marchionne splits his time between the fiat headquarters

in turin, italy, and chrysler headquarters in auburn hills, michigan, but he is fully engaged on both continents at all times. i mean, when you're here, do you get calls? do you have to deal with fiat? >> yeah. that's why i get up at 3:30 in the morning, so i can deal with the european side and be fine here by the time i get in. i mean, the other thing that helps is the--our time zones. >> when do you go to sleep? >> 10:00. i'm not really a late night guy. i used to be when i was younger. >> besides being ceo of chrysler group and fiat automotive, which has nearly 200,000 employees at 166 plants worldwide, marchionne is also chairman of the fiat industrial group, which makes heavy equipment, and s.g.s., the world's largest standards and instruments company, based in geneva. he manages all of this with five different cell phones he totes around in his knapsack. you've got a lot of jobs. >> mm, i have some, yes.

>> do you remember them all? >> yeah. but i don't get confused, since i do them all, yes? >> you and i have lived among workaholics in our day. i have never seen anything like sergio. when it was a holiday in italy, he'd come to america to work. when it's a holiday in america, he goes to italy to work. saturdays and sundays were just workdays to him and for his whole team. and anybody who signed up with sergio signed up for the program. >> marchionne does have passions besides work. he loves opera and jazz and very fast cars. in turin, he showed us the high end of the fiat automotive line, which includes maserati and ferrari. these are great-looking cars. is there anything here for less than half a million dollars? >> all of them. >> all of them? sergio owns a couple of these, but he has no opportunity to drive them. as head of italy's largest industrial empire, his life is much different here. he's required by the government to travel in bulletproof cars with police escorts and is always surrounded by state security.

sergio seemed more than happy to take us to the old test track that still sits atop an old factory for a short spin in this limited edition alfa romeo, a legendary brand that he will reintroduce to the u.s. market in 2014. [car engine revving] but even here he was unable to escape his security detail. >> it has a severe impact on your private life, because you're always with them when you're there. it's part of life. it's part of what i do. >> do you have a private life? >> sure, i do. and it's private. it's private. >> what he likes to discuss is business, which is worse in europe than in the u.s. what promises to be a serious recession is beginning to affect the economy there, and fiat and other european carmakers are struggling. but it should not affect

the future of chrysler. do you think they're out of the woods? >> i think the question of whether chrysler will survive or not is largely behind us. i think the question at this point is how big a market share can they have? how good can their products be? >> there are plenty of new products in the pipeline. but marchionne, who is right now obsessed with quality, is taking nothing for granted. what's the biggest challenge facing chrysler right now? >> that we're gonna slip on execution. we're gonna get something wrong, big. >> like what? >> we're gonna screw up on a car. it won't sell. it's possible. >> can you afford that? >> one car, yes. now i can afford a car. 12 months ago, it would have been a--it would have been a disaster. but now i can take the pain. not-- one--one car. >> since our story first aired,

chrysler's comeback has continued. in september 2012, the company announced that its sales had increased 11.5% from the same period a year earlier. that marked chrysler's 30th consecutive month of year over year sales gains. [ticking] coming up, the dangerous business of truffles. >> when they took your dogs, what did you do? >> [speaking french] >> i looked for them all over europe. i found a world i didn't know about. it's a world that's rotten to the core. >> did you find your dogs? >> never. >> never. >> the world's most expensive food, when 60 minutes on cnbc returns. [ticking] ♪

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>> just a couple of shavings of black truffles from france, known as black diamonds, can cost hundreds of dollars in a restaurant in paris. white truffles from italy cost more than three times as much. a delicious delicacy, some say truffles are an aphrodisiac. they're also ounce for ounce the most expensive food in the world. in france and italy, truffles are under siege because they're becoming scarce. and as lesley stahl reported in january of 2012, they're being trafficked

like drugs, stolen by thugs, and threatened by inferior imports from china. >> he found one already? where, where, where? where? he found one? oh, my god. oh, smell that. in the beautiful italian province of perugia, truffle hunters roam the frosty hills with their trained dogs, who sniff out these lumpy mushrooms when they're ripe, one at a time, as they have for centuries. wow. truffles grow wild, underground, usually at the base of an oak tree. [pig snorts] they used to use pigs, but they ate the truffles. >> very rich american people, they only see truffles on the table of a very elegant restaurant. they don't see this. now you know why they are expensive, right? >> olga urbani may be the only person in the world who goes truffle hunting in a full-length

fur coat and a caribbean tan. but in the truffle business, she can pretty much do what she wants. olga. >> yeah. >> her company, urbani, controls 70% of the world's truffle trade. >> when you find the truffles, it's like to have a miracle. >> another one. other countries, including the u.s., have tried cultivating truffles with only limited success. oh, another one? it's the combination of european red soil and rainy summers that produce an especially rich earthy flavor. the price these truffles command make hunters act like they're mining for gold. so this is $1,000? just right there is $1,000. and it's why the hunters value their dogs more than just about anything. >> [speaking italian] >> [laughs] he said, "i really love my wife, but the dog..." >> these truffles will go right to the urbani factory,

where they're washed, sorted, and either frozen or canned, or flown fresh to fancy restaurants, like new york's d.b. bistro moderne, home of the $150 hamburger smothered with truffles. a few shavings on pasta can run you even more. at an auction in macau in 2010, this two-pound white truffle sold for $330,000, a record amount. it's not like agriculture. people don't put a seed in the ground. >> no. >> and they're a fungus. >> yes, they're underground fungus. >> so the farmer really can't make it happen? >> no, they can't do anything. we can't do anything. you're always on the phone, many telephones, saying, "sorry, sorry, i don't have. i don't have." and i wish i had 100 tons a day to make everybody happy. >> in france, the truffle is so revered

that in the village of uzes, a special mass is held in its honor. churchgoers not only put money in the collection plate, they also add truffles. there's a reason for the special prayers. because of climate change, the harvests are down from an annual haul of 2,000 tons of truffles 100 years ago to just 30 tons today. the scarcity and high prices have attracted elements of organized crime, who've turned the truffle trade into something resembling the drug trade. >> [speaking french] >> the reality is, behind the popularity of the truffle lies a dangerous world. >> my house is your house. >> one of europe's most famous truffle connoisseurs is the larger-than-life french chef and restaurateur known simply as bruno. is it like the mafia? >> yes. >> really? >> that's a good name. >> at bruno's restaurant,

in the heart of provence, wealthy europeans helicopter in from paris and monaco just to eat lunch. bruno goes through about 5 tons of truffles a year, which his chefs shave on everything from potatoes to this amazing lobster dish. but bruno says the growing black market has led to people coming to his place not just to eat truffles, but to steal them. the robbers came and got your truffles? >> [speaking french] >> yes, they stole 200 kilos of truffles. >> 200 kilos from you? >> [speaking french] >> they didn't steal my money. they stole my truffles. >> some of the stolen truffles, we were told, are brought to markets like this one in richerenches, where middlemen sell out of the backs of cars or trucks. but large quantities change hands in back alleys. we witnessed this transaction where the buyers and sellers wanted their identities hidden. in less than a minute, 50 pounds of truffles were exchanged for 30,000 euros--

about $40,000-- with no questions asked about where the truffles came from. >> [speaking french] >> there's a problem of confidentiality and secrecy. and that encourages a mafia-like attitude. >> michel tournayre, a third generation truffle farmer, says that local trufflers have been carjacked, beaten with baseball bats, and even killed. thieves came and stole his truffles, his trees, and, worse, his dogs. when they took your dogs, what did you do? >> [speaking french] >> i looked for them all over europe. i found a world i didn't know about. it's a world that's rotten to the core. >> did you find your dogs? >> never. >> never. [ticking] >> coming up, the impact of cheap chinese imports. >> if i went to china and took it out of the ground, it still wouldn't taste as good? >> no, no. it's like eating wood. >> that's ahead

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unlike in france, where dogs smell when a truffle is ripe, the chinese rake at the earth with no dogs, as a cbs news producer in china discovered, and harvest the truffles the minute they find them. which explains why, while the two truffles look the same, the price is drastically different. >> prices of winter truffles is about $1,000 a pound. a pound of chinese, maybe $20, $30. there are many people, bad people, who mix them. so maybe they put 30% of chinese, 70% of-- >> and they think you won't see it? [chuckles] on the day we were at the urbani factory, sorters found a number of chinese truffles mixed in with that day's purchases. they were separated out into specially marked red baskets. more and more, chinese truffles are slipped in with the good french

or italian strains. experts say it's like cutting flour into cocaine. but look, your own farmers around here, or your own middlemen, are putting the chinese... >> yes. >> in with your truffles. you're telling us you have to be on guard, not from the chinese, but from your own people. >> yeah, i know. >> and then you're selling them. >> i know. >> food importers and middlemen are bringing 28 tons of chinese truffles into france a year. and many are being passed off as the real thing in some french restaurants. michel tournayre says he's brought home some slices from his dinners out and studied them under a microscope in his lab at home to check their origin. it does look different. tournayre has tried to blow the whistle on the restaurants that sell chinese truffles at french prices, but the police have more important matters on their plate and rarely do anything about it. 28 tons of chinese truffles

come into france every year. where do they go? >> [speaking french] >> i think i know where they go, but i'm not going to tell you. >> if you tell me, you're in trouble, is what you're saying? they'll hurt you? >> [speaking french] >> everybody's in danger in this business. >> krrrk. >> so we began to look for chinese truffles ourselves. we found this product that is exported to the u.s. on the front of the can, it says "black winter truffles, product of france", while on the back, in small print, it says "tuber indicum", the latin name for chinese truffles. >> [singing in french] >> when we showed one of the cans to the urbanis at a kitchen at their headquarters, it seemed to ruin their lunch. >> this makes us crazy. this destroys all the tradition of the truffle. it's an entire life that goes

in the garbage. it's unbelievable. >> american law doesn't require a distinction between varieties of truffles. and this product does sell for considerably less than the best of france. but american consumers are being deceived into thinking they're getting the finest quality at a bargain price. the owner of this brand is pierre jean pebyre. >> this is your company, right? >> yes. >> okay, so we found this in the united states. >> yes. >> okay, so this says, "black winter truffles." >> yes. >> but it's chinese. >> it's chinese, yes. this is a tin. it's a french product. the truffles-- if i put--if i make the tin in china, it's a chinese truffle. >> i'm stunned. he was saying that since the truffles are packaged here, he can legally write "product of france" on the label. it feels like i'm being tricked